What a gorgeous room. Well, view! It has great bones and so much potential with the right furniture placement. If this space is currently walk through, I also like the bookshelf idea but to expand on that, I'd actually stud wall and plaster up as a dwarf wall, then install a suspended desktop behind the long section for a desktop workstation, with the smaller return to have concealed shallow cabinetry, say around 200mm deep doors with shadow lines, so it houses your odds and ends. With so many finishes available, you could splash out on a stone top or timber to link the horizontal plane with the new floor, and emphasize linearity, or keep it all in our chosen neutral to avoid it as a feature. That small but practical 2mtr area could be a great central hub, somewhat behind the key living area, but a very versatile space bridging the adjoining areas. Otherwise this bannister area will always be a walk through space.

Wow! Overwhelmed with all the responses and some great ideas put forward :) I should have probably stated in my first post that I am trying to keep it to a pretty small budget (was thinking of even going down the Ikea route for the cabinetry etc and installing myself). This is because I have spent my life savings on a $810,000AUD house (so don't want to spend more that 15k on renovating I am only 30 years old :)) I do realise I am going to have to spend thousands to get the flooring sorted. Good to hear that you guys think it will be possible to get the wood to match. I am very particular about these things so was thinking not to do it. Responses below in the order they were posted :) Chanop thanks for your help - I think changing the shape of the kitchen to an L or C might have been a good idea when originally designing it but with the middle island already plumbed and with electrics with 2 dishwashers (I will most likely remove one) I think ill just have to stick with it considering my low budget. Is there something wrong with have rangehoods recirculate? Just thought it would be easier as I could do it myself if it wasn't vented outside. I definitely want to get more drawers than cupboards for the lower cabinets - good idea. Was thinking of moving the microwave into the pantry as it has power and we don't use the microwave often anyway. Mrjudsonjames I agree with you on not changing the shape - I really like your idea on moving the sink to the island and i think I will definitely have space if i remove one of the dishwashers that I don't need. Yeah fridge size is definitely an issue with the current space - hadn't thought of storing more food that doesn't need to be refrigerated in a refrigerator - interesting. Fridge wont fit under stairs unfortunately would have been handy - however i plan on having more storage under the stairs (not sure how to execute this yet). Bec - Yep definitely good idea with the sink - am definitely going to try to do get that done :) I'm not really sure what you mean with the half height windows - have you seen an example somewhere you could post? Yep white all the way in this instance - it all feels way too dark at the moment. sstop - not sure whether the wall behind the fridge is load bearing or not might need to get that checked out. However, removing might be a project for the future as I don't have a huge amount of money to spend. Good idea - maybe i will look to see what I would fetch for the freestanding cooker on eBay (it RRPs for around 7K) not sure. I hadn't thought about staggering the joints and this will definitely help - thanks. LouieT - Yeah the layout is a bit of a disappointment - but the terrace house was originally built in the year 1886 originally so definitely going to be some quirks. Yeah I agree on not moving the plumbing going to cost too much. I'm not sure about adding a return as it will enclose the kitchen even more with the bench still there. I want it to have more flow than it currently does. I love the idea of a pendant light! I will definitely have to get one of those over the island - great idea!! dohraime - Yeah as I said to LouiT don't like the idea of removing the island seems like a waste of plumbing and electricity i want to try to make it work even if it's not perfect. Yeah unfortunately the cabinets are of an odd height. Definitely getting new cabinetry to replace them. I am already concerned about not having enough storage so losing those top cabinets to open shelving scares me a little. bissym - WOWWEEE! Your plan really excited me - not sure why when the place was renovated 10 years ago they didn't do it that way would have been WAY better. I am definitely keeping this in mind for phase 2 of my renovations. Not sure how much it would cost to knock down walls etc will get a quote at some point. Now my main focus and problem area - is the kitchen and your plan doesn't effect that area really. Will definitely be ripping of the big curved granite benchtop on the kitchen island as soon as i move in. OK so I hope I didn't forget anyone - and I definitely have got some fantastic ideas from you guys. So my main take home points appear to be currently just trying to sort out the island and fit a sink in it, changing the cabinetry to accommodate a larger fridge, getting floorboards to match and putting up some dangly lights.

my 8 seater table with chairs fits in 3300 x 2400 with the chairs pulled away from the table...Without walls closing in your dining room on two sides there should be enough space for your table and for someone to squeeze around to go to the bathroom but if you have 8 adults for meals regularly it might be necessary to consider a "bay window" style mini extension and rotate the table to extend out over the deck area with sliding doors and side windows it would have a conservatory feel with an overhead beam at the join and sloping ceiling in the extra space there would be no need to attempt to continue the original ceilings

Sorry but I am confused by the purpose and function of this entire space. Form follows function.... But I am not seeing the function being clear so that is causing the problem with the design. Your layout and comments imply that: someone is playing piano, someone is watching movie in theatre room, someone is playing with toys, someone is watching huge TV in living area, someone is cooking.... All at the same time. If so, then these needs will dictate the design... Or whatever your specific needs are. I would start by defining function priorities (storage, view, access, etc) and then work from there ~ prioritise these functions and estimate boundaries/size to define zones that are needed. Have another plan of things that cannot be changed easily - windows, kitchen, powerpoints - with dimensions from reference point. Ask questions like: how often will we/I use this _ do we really need separate piano room_ do we need to use French doors daily _ do I want to walk past new lounge suite carrying food _why would iI use both theatre room and living room at same time _ do I need all these windows or can I fill in one to get more function in the space _ Good luck as you will have to balance needs and wants!